The Supreme Court on Tuesday took note of the settlement arrived at between Adani Power (Mundra) Ltd and the Gujarat Urja Vikas Nigam Ltd (GUVNL) and closed the curative plea of the state PSU challenging the apex court’s 2019 verdict upholding the private firm’s termination of a power purchase agreement (PPA).
A five-judge Constitution bench headed by Chief Justice N V Ramana was told by Attorney General K K Venugopal, appearing for GUVNL, that a settlement has been arrived at between the state PSU and Adani Power (Mundra) Ltd on January 3.
The top law officer said that in view of the settlement, the curative plea be closed and the verdict may be modified accordingly.
The bench, which also comprised Justices U U Lalit, D Y Chandrachud, B R Gavai and Surya Kant, said it would close the case by recording that both the parties will be governed by the settlement agreement.
The counsel for Adani Power supported the submission of Venugopal and said that the private firm would resume supplying 2000 MW electricity to GUVNL as per the settlement deed.
In a significant development on September 17, last year, the bench had decided to hear in an open court the GUVNL’s curative petition which, as per industry estimates, was to pay nearly Rs 11,00 crore compensation to Adani Power.
A three-judge bench in July 2019 had held that the notice of termination of a PPA by the Adani Power to GUVNL in 2009 was legal and valid. It had ordered the Central Electricity Regulatory Commission (CERC) to determine compensatory tariff for the power supplied by Adani Power to the state PSU.
The verdict had said that the court should give effect to the “plain, literal and grammatical” meaning of the clauses used in a contract.
Adani Power (Mundra) Ltd had signed a PPA with GUVNL in 2007 to supply 1,000 MW power from its project located in Korba, Chhattisgarh.
Adani terminated the pact citing non-coal supply by Gujarat Mineral Development Corporation, claiming that the supply of electricity was conditional to coal supply.
The PPA termination notice was challenged by the GUVNL before the Gujarat Electricity Regulatory Commission which had held the termination as illegal.
The top court had, however, reversed the findings.